Utah-based Meridian Restaurants Unlimited, at one time one of the largest Burger King franchisees, filed for bankruptcy March 2.
Meridian Restaurants Unlimited has agreed to sell 70 Burger King restaurants for just under $18 million with the portfolio of units from the Utah-based bankrupt company being divided between the franchisor and four franchisees.
According to court filings, Burger King bought 32 restaurants—17 of which are in Utah, 12 in Montana and three in Wyoming—for $4.7 million and agreed to support Kansas King’s efforts to buy 16 restaurants with $1.5 million in supplemental funding. Missouri-based Kansas King paid $2.2 million for 11 restaurants in Kansas and five more in Nebraska.
Louisiana-based Dakota Restaurant Partners bought 12 Burger King units from Meridian for $3.4 million with nine of the restaurants in North Dakota, two in Minnesota and one in Montana.
Phoenix-based Kraf Inc. bought seven units in Arizona for $7 million while Boise, Idaho-based Snake River Foods bought three Montana units for $632,250, according to court filings.
South Ogden, Utah-based Meridian filed for bankrupty protection March 2 in the U.S. Bankruptcy Court Utah District in Salt Lake City. According to court documents, there were no acceptable qualified bids for the remaining 21 Burger King restaurants in Meridian’s portfolio. The limited liability company, that at one time was one of Burger King’s largest franchisees, also franchises a number of Black Bear Diner units that were not involved in the case.
Burger King ranked No. 4 on the Franchise Times’ Top 400 list, which ranks brands by systemwide sales. The company’s systemwide sales in 2022 were more than $25.4 billion across 19,789 units worldwide—making its average unit volume nearly $1.3 million.
Meridian Chairman James Winder was unavailable for comment this week.
Meridian’s filing marked the second major bankruptcy by a Burger King franchisee this year and followed 90-unit Toms King, which has all of its restaurants for sale, according to court documents filed in January.
Meridian attributed its bankruptcy to cash flow issues stemming from increased wages, labor costs, shipping, food inflation, decreased availability of staff, and declining food traffic. The company was suffering from lower revenues, without proportionate decreases in rent, debt service, and other liabilities.